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April 11, 1998
. Vreme News Digest Agency No 340
FRY — Slovenia

Business Without Nostalgia

by Svetlana Vasovic

VREME: It appears that recently, there is actual progress in relations between Slovenia and FR Yugoslavia.  It could be said that your contribution to this has been crucial?

CUK: It is very important for an exchange of goods to exist between nations, as well as for people to visit each other, both for business and personal reasons.  That is why, precisely because of the breaking of ice between FRY and Slovenia, it was very significant that the Slovenian Economic Delegation paid an official visit to the Yugoslav Chamber of Commerce; I believe that everything which is based on cooperation is beneficial for both states.  We believe that it is high time for normal relations to be established between Yugoslavia and Slovenia, both on political, as well as economic fronts.  That is why our Executive Committee submitted a proposal to the Government of Slovenia suggesting that it make efforts toward normalizing relations between FRY and Slovenia as quickly as possible.  I hope that such a demand by our Chamber had a positive effect on Drnovsek’s government...

VREME: What is the actual amount of trade between Yugoslavia and Slovenia?  Namely, even during the embargo our economists voiced opinions that the two economies would have great difficulties in cooperating, equally because of the results of the embargo, and because Slovenia’s orientation toward the west, while official Belgrade kept pointing out Slovenia’s great dependence on the Yugoslav market?

CUK: That the latter is not true is confirmed by statistics.  The exchange of goods with FR Yugoslavia is so small that it does not even amount to one percent of the total amount of our total foreign trade; in any case, after independence, Slovenia managed to substitute its former Yugoslav market with markets in Europe.  In the period before independence, 62-63 percent of trade occurred with republics of former Yugoslavia.  Last year, that percentage amounted to 17 percent, including, of course, all the states from former Yugoslavia.  The difference between 17 percent and the aforementioned 63 percent expresses precisely this substitution of markets.  For instance, last year we exported to Yugoslavia goods amounting to around 112 million dollars, and imported around 42 million dollars.  Total trade, therefore, amounts to around 154 million dollars, which is certainly very small, especially if we compare it to the amount of 668 million dollars realized in 1992 — in other words, the first year after independence.

VREME: If that is the case, this begs the question, why are you at all interested in this market?  Why are you making efforts to make contacts which are obviously equally difficult for the one, as for the other side?

CUK: Figures really do indicate a relatively small interest for both sides; the conclusion is clear: Serbia can survive without Slovenia, and Slovenia without Serbia.  However, it is an undeniable fact that by establishing better relations we could all live better.  As far as business in concerned, the Serbian market is equally important for Slovenia as every other market.  Why should we have a black spot on that territory?  We believe that this market will also stabilize with time and that, because of this, we must begin cooperating now with businessmen from Serbia and Montenegro.  And at the highest level.  It is clear that this is a far bigger problem on the political, than on the economic front.  We are conscious of the fact that there won’t be any revolutionary changes in the near future in doing business with Serbia, because politics on that territory are a decisive factor; and as long as all attendant agreements which are absolutely necessary for doing business with the Federal Republic of Yugoslavia are not in place, it is not likely that any higher trade volumes will be achieved.  The other, in actual fact the biggest, real problem of doing business with the Federal Republic of Yugoslavia is shortage of goods; the Yugoslav economy simply does not have enough quantities of goods intended for trade, and in the event that stores exist, quality is a big question.  It is a fact that in the past seven years Serbia and Montenegro have not invested in modernizing production; the production program is more or less the way it was seven years ago.  That is why the amounts of goods which would be of interest to us are very small, which means that it is very difficult to choose and select products from existing supplies, and later to incorporate them into reproduction chains which we would later tie to markets in Western Europe.  Neither is this comment about quality of goods a mere figure of speech, because in Slovenia, already a third of the companies has the international ISO 9000 certificate of quality.  Hence these firms require high quality service from their suppliers, which is still a big problem for many companies on the territories of the Balkans.  In short, all these reasons point to the conclusion that greater cooperation with the FRY economy would only be possible with joint investments...

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